May 23, 2006

MySpace may be in the right space at the right time. The massive social-networking site hasn’t had much luck converting its zillions of page views into cash through old-style banner ads, so now it’s reportedly seeking a search-engine partner to supply targeted pay-per-click ads throughout the site. It’s going the AOL route, in other words, hoping to instigate a bidding war between moneybags Google and moneybags Microsoft (and maybe Yahoo to boot). Odds are it will succeed, as Google’s and Microsoft’s CEOs have both recently talked about the importance of social networking sites to the future of the web. It’s hard to imagine either of these two bitter competitors ceding the sexy MySpace real estate to the other without a fight. So look for MySpace to get a deal that gives it the lion’s share of any ad revenues as well as, if it’s smart, either a cash payment upfront or some kind of guaranteed minimum payment.

May the biggest spender win!

And speaking of Google, I’m trying hard to figure out under what conceivable circumstances I would voluntarily click on a link for video advertisement. On the other hand, if I were feeling uncharitable, I could see how that might work for the MySpace demographic.

2 Responses to “Will Microsoft be MySpace’s sugar daddy?”

[...] Last month’s rumor that MySpace was seeking to outsource its search business at a good price was confirmed today and Microsoft is at least nominally in the running. Juan Carlos Perez at InfoWorld: MySpace, the social networking phenomenon that has become one of the world’s most popular Web sites, may “auction off” its search business to a major search engine operator, an executive from its parent company, News Corp., said Tuesday. [...]

[...] The MySpace eyeball auction that has been rumored since May is over and the high bidder is Google: Fox Interactive Media on Monday said it selected Google Inc. (GOOG.O) as MySpace.com’s search system in a multiyear search and advertising deal that also covers some of Fox’s other properties. [...]